As the 2020 presidential primary election season heats up, some of the nearly 20 Democratic contenders are suggesting proposals that are more than a bit socialist in nature. One of the leading contenders, Sen. Bernie Sanders, has proposed Medicare for all.
The proposal would displace the massive private insurance industry, and his suggestion led to market volatility. The proposal rocked markets, and sent share prices of healthcare stocks dropping.
Sanders isn’t the only candidate offering up such economy-shifting proposals. In his rhetoric however, Sanders is going after individual private healthcare providers by name. Bloomberg’s Drew Armstrong and John Tozzi report:
For months, health insurers have kept largely out of the fray over the proposal to expand Medicare, the government program that covers about 60 million mostly elderly Americans. As UnitedHealth’s chief executive officer began to wrap his remarks Tuesday morning during the company’s call with analysts, that changed.
The proposal would be a “wholesale disruption of American health care,” and would “surely have a severe impact on the economy and jobs — all without fundamentally increasing access to care,” CEO Dave Wichmann said on the call.
As a source of coverage, UnitedHealth is almost as large as Medicare itself. It provides health-insurance services to 49.7 million people, and last year recorded revenue of $226.2 billion. Along with insurance, it operates physician practices, sells consulting and data services, and administers drug benefits. It also covers millions of people in private-sector versions of Medicare and Medicaid.
While UnitedHealth had kept a low profile, there are signs it was already becoming a target before Wichmann’s remarks Tuesday.
Last week, Senator Bernie Sanders of Vermont, who is contending for the Democratic presidential nomination, discussed his support of Medicare for All at Fox News town hall in Bethlehem, Pennsylvania, on Monday night. Fox anchor Bret Baier asked the audience at the event to raise their hands if they had private health insurance from an employer.
“Now of those, how many are willing to transition to what the senator says, a government-run system?” Baier asked the crowd. There were cheers in the room as people raised their hands, and afterward Sanders posted a clip from the event, tweeting “raise your hand if you’re sick and tired of your private health insurance company.”
Last week, Sanders specifically called out UnitedHealth, saying in an April 12 tweet “your greed is going to end.”
Sanders specifically referenced Steve Nelson, who is chief executive of UnitedHealthcare, the company’s insurance division. Sanders cited a Washington Post story about remarks Nelson made at a company meeting.
According to the Post, Nelson answered a question from an employee about the insurer’s role in the political discussion, saying, “the last thing you want to do is become the poster child during the presidential campaign.”
A spokesman for the company said UnitedHealth has long supported the expansion of health-care coverage.
Read more here.
Jeremy Jones, CFA
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